LivingSocial Expands Its Market Reach
LivingSocial has traditionally focused on smaller businesses, including local florists, spas, and restaurants. However, earlier this month, it went more upscale and launched a $10,000 coupon for a one-day stay package at a penthouse suite at the Fairmont hotel. The package, which normally retails for $20,000, included a day’s stay in the suite and rental of a Maserati Quattroporte. It was LivingSocial’s most expensive deal thus far, by a large margin, and the company sold 115 coupons. Clearly, LivingSocial is “trying to reach a broader demographic.”

Within travel, the company also launched LivingSocial Adventures, which conducts group tours. Recently, in New York, it offered ‘Snowtubin’ and Tastin’, which gave deal buyers a round-trip bus ride to a snow tubing resort with exclusive access to a snow slope followed by a visit to a brewery. At present, Adventures is available in eight markets, and there are plans to extend to 24 markets by the end of the year.

LivingSocial’s Mobile Offerings
To expand its mobile offerings, the company is conducting a pilot program called Instant Deals for its iPhone- and Android-based smartphone app. The program uses the smartphone’s location-sensing capabilities to alert customers of smart deals running within a half-mile radius. Unlike the regular deals, these deals run for a shorter time and let merchants offer instantaneous deals to boost traffic. The pilot is being run in select neighborhoods in Washington, DC and will expand to other cities based on its success.

LivingSocial’s Global Expansion
Like Groupon, LivingSocial is focusing on international markets. It is present in 11 countries and is looking at acquisitions to grow that base. Recently, it acquired a majority stake in LetsBonus, a daily deal site with presence in 25 cities in Spain, Italy, Portugal, Argentina, and Mexico. Earlier last year, it acquired a controlling stake in Australia’s Jump On It for $5 million.

Groupon, with its $15 billion market value, is much larger and through their tie-ups is able to offer more deals per day in a city. But, Groupon’s deals are also getting weird as this 60% discount on colon cleaning proves. Meanwhile, LivingSocial is concentrating on not only adding more markets and merchants, but also on successfully diversifying offerings and demographics. The company is growing very quickly and is hiring 150 employees a month, mostly in sales. Surely, competition between the two will be interesting to watch in the near future. I particularly like the focus on travel, which could become a big business in the daily deal sector.